A gambling game or method of raising money in which a large number of tickets are sold and a drawing is held for prizes. Often sponsored by a government for a public charitable purpose. Also used to refer to any event or situation whose outcome appears to depend on chance: “Life is a lottery.” [OED]

Lotteries have long had widespread appeal as a source of funds for various projects and programs. They are relatively easy to organize and promote, inexpensive, and generally popular with the general population. State governments in the United States rely heavily on them to raise revenue for education, and as of 2006 they had allocated $234.1 billion from lottery profits (table 7.2).

People who play the lottery buy many tickets over the course of a year. They are disproportionately lower-income, less educated, nonwhite, and male. They are also more likely to be “frequent players”—who play several times a week or more.

In addition to offering cash prizes, most lotteries offer a range of merchandise or services as the top prizes. This merchandising helps increase prize amounts and reduce advertising costs. It also allows the promotion of a more diverse range of prizes to attract new players, and it provides opportunities for companies to advertise their products through lotteries. Lottery promotions often feature celebrities, sports teams and players, and cartoon characters. Many of these merchandising deals are arranged by lottery companies in partnership with manufacturers, which receive a share of the profits.